Christie blasts Horizon over $16M in fines for mishandling Medicaid

TRENTON -- Gov. Chris Christie's battle with Horizon Blue Cross Blue Shield of New Jersey to give up $300 million of its reserves to the state intensified Wednesday when the governor vilified the insurer for getting slapped with $16 million in fines from the state over a period of nine months.

In a hastily called news conference, Christie accused Horizon of having "brazenly failed its members" covered by Medicaid and renewed his push for legislation he argued would add more accountability and transparency within the insurer.

The bill would also would also force the insurer to cede some $300 million of its capital reserves to help pay for expanding New Jersey's addiction treatment services. Horizon has railed against the legislation and likened it to extortion.

But Christie insisted lawmakers get on board with the legislation. He highlighted about $16 million in fines from the state for noncompliance with certain rules, including failing to make timely payments to health care providers.

"Horizon has been cited repeatedly by two state agencies for failing since 2015 to its obligation to the public," Christie said. "Horizon has brazenly failed its members and the citizens of New Jersey who pay them."

On Monday, the Department of Human Services, which operates the state Medicaid program, slapped Horizon with a $15.5 million fine for mishandling thousands of claims over the past year and for misreporting some financial information to the state, the governor said.

Christie said Horizon also bungled a new Medicaid payment system last year that resulted in the company withholding $8 million from 1,127 doctors, hospitals and other medical providers. Horizon deemed these to be overpaid claims, but did not give the providers advance notice and a chance to appeal, according to a notice on the state Department of Banking and Insurance's website.

In March, Horizon agreed to pay a $150,000 fine for this offense, and pay $241,824 in interest to these providers to resolve the matter, according to the consent order.

Horizon also agreed in September to pay a $400,000 for wrongly denying 4,500 hospice and home care claims, according to the state consent order.

This billing problems reflect "systemic" problems, stemming from the not-for-profit's desire to make more money, Christie said.

Horizon spokesman Kevin McArdle released a statement during Christie's blistering remarks accusing the governor of punishing the company for refusing to give up millions from its reserves.

"For seven years, the governor had nothing to say about Horizon. His comments strongly suggest that this is further retaliation for Horizon's unwillingness to submit to his demand for $300 million from the reserves we hold to protect our members and an abuse of power," McArdle's statement said.

The company says it plans to appeal the "unfair and unjustified" fines because they are based on an incorrect analysis of Horizon claims data.

Horizon acknowledged it struggled to make timely payments when it switched to a cost-saving vendor reimbursing hospitals, doctors and other medical providers last year. But Horizon kept the state informed, notified providers and paid them in advance if requested.

"We are not aware of a single member whose care was impacted in any way," McArdle's statement said.

Christie accused the company of delaying millions of dollars of payments to health care providers to reap higher returns on investments.

"Providers were not being paid for the services they were providing ... (and) the bottom line is that they have a contractual obligation to do this," Christie said.

Through the Open Public Records Act, NJ Advance Media requested the document outlining the reasons the Department of Human Service cited in issuing the $15.5 million fine. The department's records custodian responded in an email Wednesday night that under its contract with Horizon, the state must give the insurance company the chance to challenge the release of any records.

Prior to Christie's remarks, NJ Advance Media reported Christie is brokering a budget deal with legislative leaders that would allow Democrats to inject an extra $125 million into state education funding in exchange for, among other things, Christie's Horizon legislation.

Horizon is the state's largest insurance provider, serving 3.8 million citizens, including 1.8 million on Medicaid.